Corporate governance, capital and risk-taking in savings banks

Luis Otero-González, Dildora Ibrajimova, Milagros Vivel-Búa, Rubén Lado-Sestayo


Purpose: This paper analyzes the impact of bank corporate governance and capital on risk-taking during the period 2004-2011, focusing on Spanish saving banks.

Methodology: This paper uses a dynamic panel data modeling and the system Generalized Methods of Moments (GMM) as a method of estimation.

Findings: The results highlight the importance of bank ownership nature and show the positive association between risk and Spanish savings banks. Furthermore, widely held banks tend to induce bank managers to increase risk-taking. The empirical evidence in this paper also contradicts the logic of prudent bank behavior which implies reserving more loan provisions during periods of rapid credit expansion. In addition, the amount of capital is found to be essential in the crisis period and all equity indicators were equally informative.

Originality: Several researches in finance attempt to explain the risk-taking behavior of banks and identify precise indicators of banks’ fragility This issue became especially prevalent following the recent financial crisis which has had a dramatic impact on the banking and financial sector of most countries. This research contributes to the existing literature by presenting unpublished evidence of Spanish banks risk taking. Note that despite the importance of the issue, there are few empirical studies and the most of these are not referred to this particular subject.


Keywords: regulation, risk, bank, corporate governance, capital.




Título: "Corporate governance, capital e risco em bancos de poupança"


Purpose: Este artigo analisa o impacto da governança corporativa e do capital dos bancos na tomada de riscos durante o período 2004-2011, com foco nos bancos de poupança espanhóis.

Metodologia: Este artigo utiliza uma modelagem dinâmica de dados em painel e o sistema Generalized Methods of Moments (GMM) como método de estimativa.

Resultados: Os resultados destacam a importância da natureza da propriedade do banco e mostram a associação positiva entre risco e bancos de poupança espanhóis. Além disso, os bancos de capital aberto tendem a induzir os gerentes a aumentar o risco. As evidências empíricas deste artigo também contradizem a lógica do comportamento prudente dos bancos, o que implica reservar mais provisões para empréstimos durante períodos de rápida expansão do crédito. Além disso, a quantidade de capital é essencial no período de crise e todos os indicadores de patrimônio foram igualmente informativos.

Originalidade: várias pesquisas em finanças tentam explicar o comportamento de risco dos bancos e identificar indicadores precisos da fragilidade dos bancos. Esse problema se tornou especialmente prevalecente após a recente crise financeira que teve um impacto dramático no setor bancário e financeiro da maioria dos países. Esta pesquisa contribui para a literatura existente, apresentando evidências inéditas da assunção de riscos dos bancos espanhóis. Observe que, apesar da importância da questão, existem poucos estudos empíricos e a maioria deles não é referida a esse assunto em particular.


Palavras-chave: regulação, risco, banco, governança corporativa, capital.

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